McDonald's has reduced prices for customers this summer following a temporary VAT reduction on children's meals that took effect on June 25. The fast food chain is passing on the tax savings to families, lowering the cost of a Happy Meal from £3.89 to £2.99, according to MoneySavingExpert.
Government's Great British Summer Savings Scheme
The Government announced in May a temporary VAT cut from 20% to 5% on children's meals in restaurants and cafes, children's theatre and cinema tickets, and admission to various UK attractions. The measure, dubbed the 'Great British Summer Savings' scheme, came into force on Thursday, June 25 and will remain until Tuesday, September 1. It aims to help families afford weekend treats and days out during the summer holidays, easing the cost-of-living pressures exacerbated by the Iran war.
Other Chains Joining the Price Cuts
Burger King has also committed to passing on the savings, reducing its kids' meal from £3.99 to £3.49. Other participants include KFC, Wetherspoon, Nando's, Hungry Horse, and Shepherd Neame pubs. The VAT reduction applies only to food consumed inside the restaurant; takeaway orders are excluded from the scheme.
Chancellor's Statement
Chancellor Rachel Reeves commented on the scheme's launch: “I know the cost of living is a number one concern for families, and it can be even harder over the summer holidays when kids want to do things and money is tight. So we’re making it that bit easier for families to make memories together and enjoy the little treats - while giving a boost to businesses across the UK.” She added that this support comes alongside freezing fuel duty, reducing energy bills by £117, and freezing prescriptions and rail fares, attributing the ability to do so to the UK's fast-growing economy.
Scope of the VAT Cut
The Government confirmed that prices will be slashed on children's menu meals served in restaurants for on-premises consumption, children's and family tickets for cinemas, theatres, concerts, shows, and exhibitions, and admission tickets for both children and adults to attractions such as amusement parks, fairs, museums, zoos, soft play centres, circuses, adventure parks, nature reserves, wildlife parks, and observation attractions. HM Treasury also announced plans to launch a Great British Savings deal finder online to help families discover local summer offers.
